Are your clients selling at a loss?

If your clients aren’t comfortable with their numbers* then you need to be working closely with them.

I used to have a client who was selling at a loss. Her materials were costing her more than her selling price. Even before taking her overheads/fixed costs into account. She also insisted on doing her own bookkeeping even though she didn’t really have time so it was always a long way behind.

8 months after her year end we received her books and pulled together her accounts. For the whole year she had been making a loss. If she had been up to date with her bookkeeping, or if she had used a competent bookkeeper, she might have spotted that loss when it occurred in the first month. Instead it went on for a year and 8 months.

Make sure that your clients’ bookkeeping is up to date and monitored by somebody who is happy with business numbers. That may be you or it may be them

*Take a look at our Finance for Business Owners webinar series if you think this might be of use to your clients

What’s your high score

What KPIs (Key Performance Indicators) do you use for your business?

There are so many KPIs that you can track but it is important to focus on the handful that are relevant to your business right now. Tracking irrelevant KPIs is about as helpful to my business as chasing my Tetris high score.

It may surprise you that, as a qualified accountant, I don’t include profit in my weekly KPIs. Profit is the consequence of doing the right things. I do, however, track my marketing activity quite assiduously. The number of industry events that I attend/speak at affects the number of books and courses that I sell. This is the right thing for me to do but your business will be different.

Our Strategic Planning Day helps to identify the best KPIs for your individual business but you can take a look and work some out for yourself. Do you need to concentrate on marketing, sales, cash balances or profitability?

Give it a try and let me know how you get on